Wills & Estates

Wills & Estates

NO WILL?  NO PROBLEM

 

Do you need a Will?

No, if you will be pennyless at your death.

Still reading?

No, if all your potential dependants, creditors and beneficiaries (remember Mel Lastman’s love child?) will get along completely.

No, if you are happy with your free will. Not the free will referred to in the metaphysical essays of Thomas Hobbes, but the one given to you by the Ontario Government. It may cost more in the end but what do you care, your dead. Free you say? That’s right. Contrary to popular belief, if you do not have a will the government will not keep all your money upon your passing.

Your free will has a name, the Succession Law Reform Act (SLRA).  This legislation provides, (just like while you were alive) that the first person to get your money is your married spouse.  “Common law” spouses do not count.  Married spouses that you threw out long ago, but did not formally divorce, DO count, a circumstance that could yield some unfortunate and unintended results. Even with a will, that spouse may advance a “family law” claim against your estate. For that matter, others can advance a claim against the estate as a “dependant” .

For marriages that end by the death of the spouse, Ontario’s Family Law Act  (FLA) provides an election for the surviving married spouse to take his or her inheritance under the Will (or SLRA provisions) ) OR the provisions of the FLA.

In a more typical situation you will die with a married spouse and 1.6 children (the legislation allows us to round up the number of your children to two (2).  In such a case the SLRA’s “free will” would provide that your married spouse gets $200,000.00 plus 1/3 of what remains of your inheritance with each of the two children receiving another 1/3 each.

Some people decide not to get married (what do they do for misery?) and have no children.  The SLRA will then provide that the inheritance goes to the deceased’s parents in equal shares.  If there are no surviving parents and without a married spouse the inheritance would then go to your brothers and sisters or if there are none surviving, their children.  In the rarest of circumstances you have no wife, children, siblings, nieces, nephews or other distant blood relatives then yes, the government does get what you own.

 Of course if you plan on dying owning nothing (or not dying at all), having a will is somewhat academic.  Personally, I do not believe in life after death, but I do believe in the gift of life after death and I ask my clients to think about online registration as an organ donor.

I am usually happier to see provisions be made to provide for your dependants while they are alive. Gifting, putting the kids on title etc. is usually cheaper  and there is a much higher chance that the people you want to receive your help will actually receive it. There are risks however. Wills by themselves dont do much. The naming of a guardian for your children for instance is only effective for ninety (90) days.

So, in answer to the question “do I neeed a will?, the answer may be YES, but you may need some basic planning advice even more.  And if one will is good, are two or three wills are even better? YES again! How about one for your relaives to see while you are alive, and another (dated a day later) setting out what you really think of them. More seriously, if you have assets outside Ontario or some assets that you don’t need to pay probate fees for, two or more wills are indicated.

Also, wills can do some cool things that no will, or the SLRA can’t. Chief among these are “trusts”, which permit delayed distribution of your estate. If little Jimmy should not get his money at 18 but at 23, or he will blow his stash on women and booze and gambling (“spendthrift trust”) or lose his social benefits (“Henson trust”) or is completely crazy or married to someone who is (“Discretionary trust”) or your slutty spouse will remarry or otherwise blow any inheritance leaving your kids penniless, with the added bonus of a s.70(6) Income Tax Act capital gain deferral! (“spousal trust”), YOU NEED A WILL.

 How much does a Will cost?

I tell my clients, “it depends”, as they confirm in their own minds that lawyers are incapable of giving straight and simple answers.  I should say up front that I have no qalms about people who like to take the free will provided by the SLRA, or buy those “will kits” sold at Loblaws or even Dollarama (careful, they may be made in China). Way less risk for me.  When I draw a will I assume risk.  In fact, almost every will I draw will be at some point looked at by a Court, or another lawyer representing an actual or “disappointed” beneficiary.  I have a duty of care both to the deceased client and it seems the beneficiaries.  I have to refer to my notes to defend the wishes of the deceased and explain why people were not included in the Will.  I may have to spend a day or two in Court without pay giving evidence. Worse, I may have to write my $5,000.00 deductable cheque to my insurance company at the suit of the “disappointed beneficiaries”. In “simple wills”  (the term actually has no defined meaning), I consider these eventualities as unlikely.  Everybody that would expect to receive an inheritance actually receives it and there is unlikely to be any fighting.

Take a “simple will”, add in a will for your spouse, Powers of Attorney for Health and Property and some basic Estate Planning advice and our typical bill including HST runs to about $800.00.

Life (and wills) are not always simple.  If you own assets in other jurisdictions (such as a Florida condo), have a second family from prior relationships, wish to cut out beneficiaries that would normally expect to receive an inheritance, have beneficiaries with special needs or disabilities, have very diverse and substantial holdings, or are party to things like marriage cntracts or shareholders agreements, you should expect to receive more thorough advice.  Multiple wills for different countries/provinces or for different types of assets may be needed. Trusts (see above) can add risk and drafting complexity. Add a capacity assessment (are you too crazy to make a will?) and some accounting advice and it is easy to watch the costs rise.

Finally,

YES, your marriage does invalidate your prior Will,

YES, you should at think about donating your organs and saving a life, and

YES, you should think about giving things and succession planning now, while you are alive.

The above is not intended as legal advice. I will deny having ever written this. You should speak to a qualified lawyer with wills and estates experience before doing anything, including making a will, power of Attorney, or large gift.